ViaSat aims for speed for the dollar

New Internet satellite plans will offer 12 megabits per second at $50 a month

Satellite Internet service has a reputation for being clunky and expensive, only suited for rural households not served by cable or telephone companies.

Carlsbad-based ViaSat is trying to change that perception, and is beginning to take the wraps off just how it’s going to do it.

The company, which launched a high-capacity Internet satellite in October, is starting to roll out pricing plans for its service. While final details aren’t expected until January, the company said it expects a base plan to offer 12 megabits per second download speeds for $50 a month.

“My first impression is that’s a decent price,” said Lee Ratliff, senior broadband analyst with industry research firm IHS iSuppli. “It’s not a world-beating price, but it’s competitive with what you can get from AT&T, Verizon and the cable companies — if you’re able to get the kind of bandwidth at all. There are a lot of people who can’t get that kind of bandwidth from their provider.”

ViaSat, which will sell Internet service through its WildBlue Communications arm, is providing much faster speeds than existing satellite Internet, where $50 a month typically gets subscribers downloads of 1 megabit per second or less.

Moreover, ViaSat thinks its satellite offering will be attractive to households with telephone company DSL Internet service. While DSL generally costs less than $50 a month, it is much slower — particularly for households farthest away from switching stations.

“People with 3G wireless or long-loop DSL are paying $30 or $40 a month for a 1-megabit or 1.5-megabit service,” said Tom Moore, head of WildBlue. “Would they be willing to spend $50 a month for a 12-megabit service? We think a lot of them would.”

About 12 million to 15 million U.S. households are potential targets for ViaSat’s service, Moore said.

It remains to be seen whether faster speeds will lure customers. Equipment and installation costs for Internet satellite can run $150 or more. Competition is on the rise from cable companies expanding their footprints and growing 4G wireless networks.

“Satellite has been for people who don’t have a better solution,” Ratliff said. “And more and more people are going to have better solutions, if not with cable then with Verizon (4G) as a wireless option.”

ViaSat, however, says it has improved the satellite experience so it’s on par with the alternatives. The company expects to offer data caps that are “materially better” than those from wireless providers, Moore said.

In addition, ViaSat has new technology in its ground equipment and modems aimed at overcoming a key complaint about satellite Internet known as latency — delays in two-way communications that make voice calls, Skype calls, online gaming and other real time website activities difficult via satellite.

The company’s new technology has trimmed lag time significantly. At a demonstration at the company’s Carlsbad headquarters, voice calls had latency delays that were no worse than those on a cellphone. Websites loaded fast, with download speeds easily beating 12 megabits per second in tests using a speed-gauge program on the U.S. Federal Communications Commission website.